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Supreme Court Thwarts Trump Bid to Oust Fed’s Cook · Bloomberg Intelligence

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  Speaker 1: Bloomberg Audio Studios, podcasts, radio news. You're listening to the
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  Speaker 1: Bloomberg Intelligence Podcast. Catch us live weekdays at ten am
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  Speaker 2: Here's a great lead sense in a Bloomberg in History
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  Speaker 2: by Greg Store. A divided US Supreme Court expanded the
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  Speaker 2: president's power to fire top government officials in a blockbuster
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  Speaker 2: decision that puts the White House firmly in control of
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  Speaker 2: potentially dozens of agencies that have long operated independently. I'm
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  Speaker 2: not sure how to think about that. I think everybody's
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  Speaker 2: trying to digest it. Nick Ackerman, he's got some thoughts.
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  Speaker 2: He's a former assistant special Watergate prosecutor.
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  Speaker 3: Nick.
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  Speaker 2: Thanks so much for joining us here. It seems like
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  Speaker 2: the executive branch just got a big, big win today.
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  Speaker 2: How do you think about that?
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  Speaker 4: Well, they did, and they didn't. They certainly got it
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  Speaker 4: on all of the agencies other than the FED. The
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  Speaker 4: Supreme Court told the President that he cannot fire Lisa
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  Speaker 4: Cook unless he fires her for cause, gives her notice,
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  Speaker 4: has a hearing. He can't just use it to basically
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  Speaker 4: take over the FED and bend the FED to his will.
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  Speaker 4: The Court there said very clearly that Congress intended that
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  Speaker 4: the FED would have independent power to regulate the economy. Now,
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  Speaker 4: on the other hand, the other case that came out
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  Speaker 4: today had to do with the Federal Trade Commission, where
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  Speaker 4: the Court essentially went along with this unitary executive theory
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  Speaker 4: that if the agency itself was doing what would normally
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  Speaker 4: be done by the President as part of his executive authorities.
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  Speaker 4: I mean, keep in mind that the FTC does antitrust
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  Speaker 4: enforcement pretty much the same thing that the Department of
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  Speaker 4: Justice does. That what the court said was that those
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  Speaker 4: are matters within the realm of the executive power, and
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  Speaker 4: therefore the President has the right to fire those people. Now,
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  Speaker 4: they did leave open the notion that there's maybe another
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  Speaker 4: issue out there that has to do with whether or
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  Speaker 4: not something like the FTC is a semi judicial body,
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  Speaker 4: and that the FTC commissioners sit as judges in certain
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  Speaker 4: respects and therefore are entitled to a little more deference.
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  Speaker 4: But the Court said that's an issue for another day
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  Speaker 4: and sent that back to the lower courts for consideration.
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  Speaker 5: Okay, so does that mean Rebecca Kelly Slaughter has a
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  Speaker 5: recourse here that she can kind of reltigate what's happening.
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  Speaker 4: Well, all she can re litigate is to argue that
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  Speaker 4: just as we had always thought about these federal agencies,
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  Speaker 4: that they're quasi judicial, quasi legislative, and quasi executive, and
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  Speaker 4: somehow she's got to be able to argue out that
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  Speaker 4: there is a special part of this that is quasi
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  Speaker 4: judicial and that she should be permitted to continue in
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  Speaker 4: that role. The problem with that is is that obviously
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  Speaker 4: a FTC commissioner has a lot of different roles and
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  Speaker 4: to separate it out is not that easy. And why
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  Speaker 4: would you keep somebody in just for that purpose. I
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  Speaker 4: just don't know where this goes, but it seems to
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  Speaker 4: me any president who now comes into office has the
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  Speaker 4: right to get rid of all the FTC commissioners, the
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  Speaker 4: FCC commissioners, etc. In order to put his own people
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  Speaker 4: in there. What's unfortunate it is in the past, whatever
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  Speaker 4: president was in power got the majority of commissioners, and
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  Speaker 4: the other party, whether it was Democrat or Republican, had
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  Speaker 4: a certain number of positions.
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  Speaker 3: It really was.
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  Speaker 4: More of a bipartisan type of op This will make
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  Speaker 4: it much more partisan in terms of who gets appointed
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  Speaker 4: to these positions. It means whoever becomes president will have
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  Speaker 4: the power to appoint those commissioners.
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  Speaker 2: All Right, Nick, If I'm former FED Chairman Jerome Powell,
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  Speaker 2: how do I look at this Lisa Cook.
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  Speaker 3: Decision?
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  Speaker 2: Do I feel comfortable leaving the FED and going out
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  Speaker 2: in the private practice?
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  Speaker 4: Well, I guess there's two parts to that that question. One,
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  Speaker 4: I think he feel comfortable knowing that Lisa Cook cannot
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  Speaker 4: be taken away, that nobody else can be taken away
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  Speaker 4: just because President Trump disagrees with how they come out
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  Speaker 4: on interest rates. On the other hand, it does mean
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  Speaker 4: that the president can appoint other people that he can
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  Speaker 4: still put in his own individuals. And if I were
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  Speaker 4: the chairman, the former chairman, I don't think i'd leave
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  Speaker 4: quite yet, since he's going to be a vote more
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  Speaker 4: consistent with an independent view than the others, And so
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  Speaker 4: from that standpoint, I would stick it out for a
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  Speaker 4: while and see how things go. I think he has
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  Speaker 4: to feel comfortable before he leaves. He can feel comfortable
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  Speaker 4: on the lease of situation. But as to how else
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  Speaker 4: the FED is run, I think he probably has to
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  Speaker 4: wait and see right.
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  Speaker 5: And of course he also probably wants to wait for
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  Speaker 5: that dog investigation to be completely put out to pasture
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  Speaker 5: Nick before we let you go. We know the Supreme
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  Speaker 5: Court will issue its remaining opinions tomorrow and that includes
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  Speaker 5: the birthright citizenship decision. How are you thinking about what
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  Speaker 5: a likely decision would mean for the economy.
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  Speaker 4: Well, I think it's going to be it should be
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  Speaker 4: at least that they're just going to go along with
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  Speaker 4: the plain language of the Constitution that somebody born in
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  Speaker 4: the United States is a citizen the United States unless
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  Speaker 4: they have some other jurisdictional issues, such as being the
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  Speaker 4: offspring of an ambassador from a foreign country. I don't
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  Speaker 4: think that will really impact the economy whatsoever. The decision
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  Speaker 4: a few days ago relating to the Haitians and the Syrians,
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  Speaker 4: that does have an impact on the economy because those
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  Speaker 4: people could be sent back to their countries, They could
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  Speaker 4: be taken out of the economy, could be taken out
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  Speaker 4: of their jobs. And that is where I think where
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  Speaker 4: we're going to see an impact on the economy, none of.
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  Speaker 3: Which is good.
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  Speaker 6: Stay with us. More from Bloomberg Intelligence coming up after this.
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  Speaker 1: You're listening to the Bloomberg Intelligence Podcast. Catch us live
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• 6:58
  Speaker 5: Let's check in with Mike mcglohone's our senior monoty strategists
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  Speaker 5: for Bloomberg Intelligence. Mike, the latest out of Iran and
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  Speaker 5: the Middle East is that both sides have agreed to
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  Speaker 5: halt mutual attacks.
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  Speaker 6: Is that necessary for crude oil prices to kind of
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  Speaker 6: stay at these.
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  Speaker 5: Current levels or if there's going to be you know,
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  Speaker 5: skirmishes once again because we've gone through a couple of
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  Speaker 5: weekends like this, will that reignite oil prices?
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  Speaker 4: Well?
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  Speaker 7: I think the round trip world US scarlet's much poor appropriate.
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  Speaker 7: I don't think we've ended the bottom end of that
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  Speaker 7: round trip, So something really bad has to happen straight
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  Speaker 7: for crudell to maybe get near or stay above eighty.
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  Speaker 7: I think that's what most traders are looking at, is
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  Speaker 7: leveling want to reset those shorts, and both entities in
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  Speaker 7: the Strait have vested interest in its staying open now.
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  Speaker 7: I mean rants getting a good deal can sell crude
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  Speaker 7: all and an open market. Finally that drill Will is
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  Speaker 7: going global, so the normal scales for crudell to get
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  Speaker 7: back to where it was before, but with fuel this time,
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  Speaker 7: because we just added a lot of supply and in
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  Speaker 7: Western Hemisphere from all those prices going up, that was
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  Speaker 7: hovering around fifty five dollars of barrels. So Mike base
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  Speaker 7: case or second half of the year is we're going
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  Speaker 7: to press below that and potentially towards forty. On one
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  Speaker 7: key premise, the stock market drops down a little bit
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  Speaker 7: and stays down a little bit. That's usually how crude
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  Speaker 7: oil makes bottoms. Just stock market has to go down.
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  Speaker 2: So is there going to be a if you talk
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  Speaker 2: to your trader buddies, some kind of straight of FORMUS
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  Speaker 2: kind of premium baked into global oil, or is reach
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  Speaker 2: can go right back to supply and demand.
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  Speaker 6: Well, I've already gone.
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  Speaker 7: Back to it, Paul, But we've accelerated the supply and
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  Speaker 7: decreased the demand, and we've accelerated that process of the
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  Speaker 7: redundancy of opek and the price maker status shifting to
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  Speaker 7: the Western Hemisphere. So let's look at drill will before
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  Speaker 7: this war started. First that we had US Canada. Now
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  Speaker 7: we have Venezuela, Iran, UAE, potentially Iraq. The whole world's
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  Speaker 7: going that way, and it's also looking forward to a
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  Speaker 7: potential you know, draw down in what's happening in the economy.
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  Speaker 7: So to me, this is a normal cycle. But it's
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  Speaker 7: not just Crudel. It happened in corn, soybeans, and wheat,
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  Speaker 7: bitcoin and natural We asked all those markets are heading lower,
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  Speaker 7: and the key theme is what makes them go up
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  Speaker 7: in the second half of the year. But what does
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  Speaker 7: mister Trump need for midterms? Lower inflation? Krudell's going to
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  Speaker 7: lead the way. I fully expect he's going to get
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  Speaker 7: it and heading towards below fifty and stops go lower,
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  Speaker 7: like I said, close to the forty.
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  Speaker 5: Yeah, you've been remarkably consistent about that call, Mike since
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  Speaker 5: the beginning. Let's get your take on gold prices, because
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  Speaker 5: you said commodities are going down. Gold is no exception,
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  Speaker 5: holding it about four thy thirty five, but still a
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  Speaker 5: far cry from where it was before the Iran War,
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  Speaker 5: which was basically at about five thousand.
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  Speaker 6: Two hundred or so. What is the outlook for gold
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  Speaker 6: right now?
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  Speaker 7: I think Scarlett's's shifting to a bear market on the
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  Speaker 7: back of bitcoin, and it has to look forward to
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  Speaker 7: fed vigilance. We've reached a plateau of inflation increasing and
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  Speaker 7: stock on the back of the stock market and really.
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  Speaker 3: Hurting people in election.
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  Speaker 7: So what does mister Trump need. It needs lower inflation.
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  Speaker 6: Goal's a big part of that.
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  Speaker 7: The key theme about gold is that opportunity we got
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  Speaker 7: in Q one might have been the best selling opportunity
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  Speaker 7: in this, you know, a couple couple decades, and now
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  Speaker 7: we're heading towards a more normal cycle. I think it's
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  Speaker 7: gonna be stuck in the range for years. Good supports
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  Speaker 7: around thirty four hundred, good resistance is around its two
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  Speaker 7: hundred two hundred day, moving to ravage around forty four hundred.
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  Speaker 6: But if history is.
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  Speaker 7: A guide, Goal will be stocking a range maybe for
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  Speaker 7: the next twenty years like Crudeau was the last twenty years.
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  Speaker 6: Stay with us. More from Bloomberg Intelligence coming up after this.
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  Speaker 1: You're listening to the Bloomberg Intelligence podcast. Catch us live
• 10:33
  Speaker 1: weekdays at ten am Eastern on Apple Coarcklay, and Android
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• 10:39
  Speaker 1: you get your podcasts, or watch us live on YouTube.
• 10:43
  Speaker 2: John Butler he covers all the telecom stuff for Bloomberg
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  Speaker 2: Intelligence and John Charter SpaceX you're part of the research
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  Speaker 2: team covering SpaceX here. What's what's the story here?
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  Speaker 3: Yeah, so Paul SpaceX is looking for an in in
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  Speaker 3: the US wireless market. You know, if you look at
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  Speaker 3: their satellite constellation today, they have six hundred and fifty
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  Speaker 3: direct to sell satellites that are providing very limited coverage
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  Speaker 3: and service in partnership with T Mobile by the way,
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  Speaker 3: it's called the T Satellite Service, But it really doesn't
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  Speaker 3: have the kind of horsepower where they could really compete
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  Speaker 3: closely with the incumbent carriers like AT and T or Verizon.
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  Speaker 3: And so I think what Starlink may be hoping to
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  Speaker 3: do here with Charter is get access to a terrestrial
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  Speaker 3: network that they compare with her, that they can put
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  Speaker 3: together with the satellite network and take another step forward
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  Speaker 3: towards providing what I'll call terrestrial like cellular services. I'd
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  Speaker 3: add there's a lot that would need to be done
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  Speaker 3: before they really get there, even if they were to
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  Speaker 3: partner or even buy Charter, but again, it would it
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  Speaker 3: would bring them a big step closer to competing with
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  Speaker 3: the big incumbents here, and I think there's a lot
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  Speaker 3: of concern among telecom investors about this rising competitive threat.
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  Speaker 2: So what do you think how much treastial capacity do
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  Speaker 2: you think SpaceX might need?
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  Speaker 6: Would would a charter get it done?
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  Speaker 2: Or would you need a charter, Comcast get a you know,
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  Speaker 2: an AT and T or something.
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  Speaker 3: Boy, it's a complicated question. So the cable operators have
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  Speaker 3: gotten into the terrestrial wireless business by striking a wholesale
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  Speaker 3: deal with Verizon and some of the other carriers, so
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  Speaker 3: they don't quite have this spectrum or the airwaves to
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  Speaker 3: do it themselves. They're essentially using Verizon and AT and
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  Speaker 3: T's network as a means of allowing their consumers to
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  Speaker 3: have wireless service. Starlink has about sixty five megahertz's spectrum
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  Speaker 3: I'm going to give some numbers here just to give
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  Speaker 3: a perspective, whereas T Mobile has almost four hundred megahertz,
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  Speaker 3: and so Starlink has a way to go before they're
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  Speaker 3: there as a standalone carrier. And then if they partner
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  Speaker 3: with one of the cable operators, there's the complexity of
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  Speaker 3: that wholesale deal with the carriers themselves that might get
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  Speaker 3: called into question. If you look at Charter, they have
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  Speaker 3: some spectrum, but they don't have a lot of it.
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  Speaker 3: So again, Starlink would be sort of left in what
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  Speaker 3: I'll call that subscale position in terms of having the
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  Speaker 3: right amount of airwaves to offer wireless service.
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  Speaker 2: Well, here's a name from way back in the past
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  Speaker 2: in spectrum. What happened happened to Charlie Ergen's spectrum.
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  Speaker 3: So Charlie sold his spectrum to SpaceX. Is how SpaceX
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  Speaker 3: got the sixty five megahertz of spectrum that they have today.
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  Speaker 3: And what Ergin was doing was using that spectrum, together
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  Speaker 3: with those wholesale agreements with Verizon and AT and T
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  Speaker 3: and T Mobile by the way, to offer their own
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  Speaker 3: branded wireless service. So my feeling is to just sort
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  Speaker 3: of distill it all down. Even if Starlink were to
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  Speaker 3: acquire Charter, let's say, I still think they would need
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  Speaker 3: to work out a deal where they wholesale some network
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  Speaker 3: capacity from the big three incumbents, and to date at
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  Speaker 3: least that has proven to be a little bit of
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  Speaker 3: a sticking point for them.
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  Speaker 2: So is the stock movement here a twelve thirteen percent
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  Speaker 2: move higher and Charters that tell you that some investors
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  Speaker 2: think that Starlink may infect I mean SpaceX may. In fact,
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  Speaker 2: by Trader outright.
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  Speaker 3: They might, But as I sort of think through it,
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  Speaker 3: one thing that Starlink has is they have a very
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  Speaker 3: strong broadband business, and if you look at what's driving
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  Speaker 3: the bus for all the cable operators today, it is
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  Speaker 3: the broadband business. So they're acquiring redundancy there. I think
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  Speaker 3: if they buy Charter, in my mind, I think what
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  Speaker 3: they would more likely do is wholesale the Charter network
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  Speaker 3: to begin that process of trying to figure out how
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  Speaker 3: to provide that last mile in building wireless coverage, which
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  Speaker 3: is the real challenge for a SpaceX, and having those
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  Speaker 3: network facilities would afford them a bit of an advantage
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  Speaker 3: relative to where they are today. So in my mind,
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  Speaker 3: I'm thinking partnership as opposed to acquisition, But who knows.
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  Speaker 3: I mean, I think they could go either route.
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  Speaker 2: Here.
• 15:48
  Speaker 6: Stay with us. More from Bloomberg Intelligence coming up after this.
• 15:56
  Speaker 1: You're listening to the Bloomberg Intelligence podcast. Catch us live
• 16:00
  Speaker 1: days at ten am. He's done on Apple, Cocklay and
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• 16:05
  Speaker 1: wherever you get your podcasts, or watch us live on YouTube.
• 16:10
  Speaker 2: You know, the only thing I really know about how
• 16:11
  Speaker 2: a bill becomes a law I learned from that Schoolhouse
• 16:15
  Speaker 2: rock back in the day. Ye, So yeah, I don't know.
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  Speaker 2: I mean, what's going on here? Didn't the House and
• 16:22
  Speaker 2: the Senate passed this House he did?
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  Speaker 5: It was a bipartisan boa and it was pretty overwhelming,
• 16:27
  Speaker 5: but the President decided not to sign it, and he
• 16:30
  Speaker 5: says he wants his voting right ID to be bill
• 16:34
  Speaker 5: to be passed first, but the Senate has made clear,
• 16:37
  Speaker 5: the Republican controlled Senate has made clear that the votes
• 16:39
  Speaker 5: just are not there. So Nathan Dean is our senior
• 16:41
  Speaker 5: policy analyst for Bloomberg Intelligence. Nathan, what happens to this
• 16:46
  Speaker 5: housing bill that was passed by both chambers of Commerce Congress?
• 16:51
  Speaker 6: Excuse me? But the President has yet to sign.
• 16:54
  Speaker 8: So Speaker Johnson said that he's going to send that
• 16:56
  Speaker 8: bill to the White House today. And the reason why
• 16:58
  Speaker 8: that's important is that it starts a ten day clock
• 17:01
  Speaker 8: that President Trump can essentially has three choices. He can
• 17:04
  Speaker 8: either sign the bill, he can veto the bill, or
• 17:06
  Speaker 8: he can do nothing. And if he does nothing, that
• 17:08
  Speaker 8: the bill then automatically becomes law. And I think that's
• 17:11
  Speaker 8: where you know, two of these scenarios are going to play. Oh,
• 17:13
  Speaker 8: he's either going to sign the bill or the bill's
• 17:15
  Speaker 8: going to become law. I don't see the President Trump
• 17:17
  Speaker 8: going to veto this bill because even though this bill,
• 17:20
  Speaker 8: you know, he called it Senator Elizabeth Warren's bill, like
• 17:23
  Speaker 8: you noted, it's overwhelmingly by partisan and it gives both
• 17:26
  Speaker 8: sides of the aisle the opportunity to go ahead of
• 17:28
  Speaker 8: the midterms and say we care about affordability because that
• 17:31
  Speaker 8: is the biggest driver of this bill, is that it's
• 17:34
  Speaker 8: an affordability housing bill. So that's why I think the
• 17:36
  Speaker 8: bill ultimately becomes law.
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  Speaker 2: Well, Nathan, that argument was perfectly coaching, which is why
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  Speaker 2: I think I'm gonna put some money down on he
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  Speaker 2: vetoes it. I mean, why wouldn't he, It's I that's
• 17:47
  Speaker 2: classic Trump.
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  Speaker 8: Well, so President Trump's real, you know motivation here is
• 17:52
  Speaker 8: to try and get Congress, like you said, past the
• 17:54
  Speaker 8: Save America Act. This is the bill that deals with
• 17:56
  Speaker 8: citizen you know, Senator a citizenship voting. He even said
• 17:59
  Speaker 8: that just a few moments ago on True Social and
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  Speaker 8: Response to the Supreme Court. Now, what I think ultimately
• 18:05
  Speaker 8: happens here is that they're trying to get Save America
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  Speaker 8: Act through reconciliation. Long story, short is it's not going
• 18:10
  Speaker 8: to work. But if they try and get something tied
• 18:13
  Speaker 8: to grants, and the idea here right now is that
• 18:15
  Speaker 8: you offer four billion dollars in grants to states to
• 18:19
  Speaker 8: incentivize to implement the Save America Act, that could be
• 18:22
  Speaker 8: a pathway forward for essentially Speaker Johnson to say to
• 18:25
  Speaker 8: the White House, Look, we're doing what you've asked. We're
• 18:28
  Speaker 8: doing it within the role of what we can get
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  Speaker 8: through Congress. Sign the bill. I think that's where President
• 18:33
  Speaker 8: Troub will ultimately agree to. But we'll see he can
• 18:35
  Speaker 8: always be to it, because nobody expected him last week
• 18:38
  Speaker 8: to say that he wasn't going to sign it either.
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  Speaker 5: Okay, so here's my question about this housing bill. How
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  Speaker 5: effective is it Because there's an affordability crisis in the
• 18:46
  Speaker 5: country and this is a federal bill, so it tries
• 18:50
  Speaker 5: to do things at the federal level. But there's all
• 18:52
  Speaker 5: I mean, states have their own laws and regulations and rules.
• 18:55
  Speaker 5: So does this bill, if it becomes law, really move
• 18:58
  Speaker 5: the needle.
• 19:00
  Speaker 8: So there's a short term and that there's a long
• 19:01
  Speaker 8: term aspect to this from the short term. If you're
• 19:03
  Speaker 8: listening to us right now in New York City, is
• 19:05
  Speaker 8: it going to decline the price of homes or make
• 19:07
  Speaker 8: it more affordable. No, You're not really going to see
• 19:10
  Speaker 8: much of a short term impact on this. This is
• 19:12
  Speaker 8: essentially just messaging from the short term side. From the
• 19:15
  Speaker 8: long term side, it's incrementally better for the housing. You know,
• 19:19
  Speaker 8: we've done some analysis, call it one to three percent
• 19:21
  Speaker 8: growth in terms of new homes.
• 19:23
  Speaker 6: Long story, you know, talking about the next.
• 19:25
  Speaker 8: Three to five years, but you're really looking at markets
• 19:27
  Speaker 8: like Austin, Texas, or Birmingham, Alabama, rather than New York
• 19:31
  Speaker 8: City or Washington, d C. At the end of the day,
• 19:33
  Speaker 8: this bill was mostly from the investment side talking about negatives.
• 19:37
  Speaker 8: There was some original language in here that would actually
• 19:40
  Speaker 8: sort of make the bill to rank communities unfeasible going forward.
• 19:43
  Speaker 8: That was scary for some of the single named single
• 19:45
  Speaker 8: family home reads out there, like invitation homes at AMH.
• 19:48
  Speaker 8: But ultimately there's so many exemptions in this bill. You know,
• 19:51
  Speaker 8: that really scary headline isn't really all that much of
• 19:54
  Speaker 8: an impact for them.
• 19:55
  Speaker 2: Thirty seconds left, Nathan, anything that we should be looking
• 19:58
  Speaker 2: for going forward from this Congress really quickly.
• 20:02
  Speaker 8: Two things that you're going to see in July is
• 20:03
  Speaker 8: going to see Clarity Act. This is the Crypto Bill.
• 20:06
  Speaker 8: I'm still like a sixty percent chance that this thing
• 20:08
  Speaker 8: is going to pass, but time is all the essence,
• 20:10
  Speaker 8: and you're going to see a lot of negative headlines
• 20:11
  Speaker 8: about artificial intelligence and data centers coming out of the
• 20:14
  Speaker 8: Senate side, as well a lot of debates going to
• 20:16
  Speaker 8: take place in July on that.
• 20:17
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